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1. Company Snapshot

1.a. Company Description

BTS Group AB (publ) operates as a professional services firm.It operates through BTS North America, BTS Europe, BTS Other Markets, and APG segments.The company offers a range of services that meet needs within strategy execution, leadership development programs, assessment, developing business acumen, transforming sales organizations, coaching, digital solutions, and events and services, as well as talent acquisition and succession.


It also provides human-centric consulting services.The company was founded in 1986 and is headquartered in Stockholm, Sweden.

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1.b. Last Insights on BTS

BTS Group AB (publ) faces challenges, as reflected in its recent earnings update. The company's Q2 2025 net sales are expected to be approximately SEK 720, a slight decrease from SEK 730 in the same period last year. EBITA decreased 23% to SEK 84, with an EBITA margin of 11.7%, down from 15.1%. The company has lowered its outlook for 2025, citing a slowdown in growth. Additionally, the North American business faces setbacks, while Europe and other markets show strong organic growth.

1.c. Company Highlights

2. BTS Q3 Earnings: A Tough Quarter with Profit Decline

BTS reported a 3% revenue growth in Q3, but a significant profit decline of 16% when adjusted for foreign currency exchanges, and 25% when including the currency effect. The earnings per share (EPS) came in at $0.9, slightly below analyst estimates of $0.985. The revenue growth was hampered by a decline in North America, primarily due to a large license deal that fell away, resulting in a 65% drop in profit. The weak dollar also contributed to the decline, accounting for 28% of the profit drop in North America.

Publication Date: Nov -19

📋 Highlights
  • Profit Decline:: Group profit fell -16% (adjusted) and -25% (currency-inclusive), driven by North America (-65% profit drop from APG channel loss) and currency effects (-28% in NA).
  • North America Turnaround:: New leadership and AI efficiency (2% cost reduction, +10% revenue employees) aim for H1 2026 growth, offsetting short-term declines.
  • AI Services Growth:: AI adoption bookings surged 482% YoY to $10.3M (Jan-Oct 2024), with client feedback boosting sales win rates and faster deal closures.
  • Market-Specific Performance:: Europe profit rose despite tough conditions; Other Markets declined 50% due to marketing investments and currency, but Q4 2024 margins expected to improve.
  • License Sales Shift:: One-time NA license deal loss (-$3M annualized) reduced Q3 profit, but Verity platform and AI offerings now drive sustainable revenue growth.

Segment Performance

BTS's Other markets experienced a decline due to increased marketing investments and adverse currency impacts, which made up 50% of the decline. On the other hand, BTS Europe performed well, increasing its profit in the third quarter. The Executive Coaching business continues to grow, and Sounding Board, the scaled coaching acquisition, turned to profit in the third quarter. The company's AI services are growing rapidly, with bookings of AI-related adoption services reaching $10.3 million year-to-date, up 482% from the same period last year.

Turnaround Efforts in North America

BTS North America is in turnaround mode, with a new leadership team and efforts to improve the market. The company expects the turnaround to be on track, with expected growth in the first half of 2026. The implementation of Phase 1 of the AI efficiency program has reduced underlying costs by 2% and increased revenue employees by 10% in the core business.

Valuation and Outlook

With a P/E Ratio of 7.74 and an EV/EBITDA of 6.32, BTS's valuation appears reasonable. Analysts estimate revenue growth at 5.9% for next year. The company's efforts to improve its AI services and turnaround its North American business are expected to drive growth. However, the loss of a large license deal and the impact of currency fluctuations remain risks. As Jessica Parisi noted, "Client feedback is coming in 3 different ways" regarding the AI breakthrough, with demos blowing clients' minds and helping to move deals forward faster.

Dividend Yield and Cash Flow

BTS offers a Dividend Yield of 4.54%, which is attractive for income investors. The company's Free Cash Flow Yield is 10.9%, indicating a healthy cash flow generation. With a Net Debt / EBITDA ratio of 0.3, BTS's debt position appears manageable.

3. NewsRoom

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BTS Group AB (LTS:0KGY) Q3 2025 Earnings Call Highlights: Navigating Profit Declines Amidst ...

Nov -21

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European Growth Stocks With Strong Insider Ownership

Nov -14

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BTS Group AB appoints Nomination Committee

Nov -14

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Correction of the outlook for 2025 in BTS Group AB (publ) Interim Report January - September 2025

Nov -12

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BTS Group AB (publ) Interim Report January - September 2025

Nov -12

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European Dividend Stocks To Watch In October 2025

Oct -06

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Spadel And 2 Other European Small Caps With Strong Financials

Aug -26

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BTS Group AB (FRA:BX1B) Q2 2025 Earnings Call Highlights: Navigating Challenges with AI-Driven ...

Aug -23

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.79%)

6. Segments

Programs

Expected Growth: 12.3%

Growing demand for corporate training and development initiatives, driven by increasing focus on leadership, sales, and operational excellence, is expected to drive the growth of BTS Group AB's customized training programs.

Development

Expected Growth: 10.2%

Growing demand for digital transformation, increasing adoption of cloud-based services, and rising need for IT consulting services drive the growth of BTS Group AB's software development, system integration, and IT consulting services segment.

Licenses

Expected Growth: 12.4%

Growing demand for digital transformation and increasing adoption of experiential learning solutions drive the growth of licenses from BTS Group AB (publ). The company's intellectual property, software, and technology are in high demand, particularly in the fields of leadership development and sales training.

Other

Expected Growth: 10.5%

The 'Other' segment's growth is driven by increasing demand for digital learning platforms, expansion of BTS Academy, and strategic investments in emerging markets, leading to a forecasted CAGR of 10.5%.

7. Detailed Products

Strategy Consulting

BTS Group AB provides strategy consulting services to help organizations develop and implement business strategies, improve operational efficiency, and drive growth.

Leadership Development

BTS Group AB offers leadership development programs to help organizations build leadership capabilities, improve leadership skills, and drive business results.

Sales and Marketing Solutions

BTS Group AB provides sales and marketing solutions to help organizations improve sales performance, enhance customer engagement, and drive revenue growth.

Digital Transformation

BTS Group AB offers digital transformation services to help organizations leverage digital technologies, improve operational efficiency, and drive business innovation.

Change Management

BTS Group AB provides change management services to help organizations navigate change, improve employee engagement, and drive business results.

Operational Excellence

BTS Group AB offers operational excellence services to help organizations improve operational efficiency, reduce costs, and drive business performance.

8. BTS Group AB (publ)'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for BTS Group AB (publ) is medium due to the presence of alternative transportation modes such as road and air transport. However, the company's strong brand and extensive network of routes and schedules make it difficult for substitutes to gain significant market share.

Bargaining Power Of Customers

The bargaining power of customers is low due to the lack of concentration in the customer base and the high switching costs associated with changing transportation providers.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of multiple suppliers of fuel, equipment, and other essential inputs. However, the company's large scale of operations and long-term contracts with suppliers mitigate the bargaining power of suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the transportation industry, including the need for significant capital investment and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established players in the transportation industry, leading to intense competition for market share and pricing pressure.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 20.93%
Debt Cost 8.19%
Equity Weight 79.07%
Equity Cost 9.92%
WACC 9.56%
Leverage 26.47%

11. Quality Control: BTS Group AB (publ) passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Science Group

A-Score: 7.0/10

Value: 6.4

Growth: 7.6

Quality: 8.7

Yield: 1.9

Momentum: 8.0

Volatility: 9.7

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Rejlers

A-Score: 6.3/10

Value: 5.1

Growth: 7.0

Quality: 6.2

Yield: 5.0

Momentum: 8.0

Volatility: 6.7

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BTS Group

A-Score: 5.0/10

Value: 5.9

Growth: 7.4

Quality: 7.8

Yield: 4.4

Momentum: 0.5

Volatility: 4.0

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Enento

A-Score: 4.9/10

Value: 4.1

Growth: 3.3

Quality: 5.4

Yield: 6.9

Momentum: 1.5

Volatility: 8.3

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Alpha FMC

A-Score: 3.7/10

Value: 1.7

Growth: 5.3

Quality: 7.0

Yield: 3.1

Momentum: 4.0

Volatility: 1.0

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Fintel

A-Score: 3.5/10

Value: 2.8

Growth: 3.1

Quality: 6.0

Yield: 2.5

Momentum: 3.0

Volatility: 3.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

141.8$

Current Price

141.8$

Potential

-0.00%

Expected Cash-Flows